On July 4, President Trump signed into law a sweeping budget bill passed by the House and Senate, delivering on multiple Republican policy goals. Here are the biggest changes to healthcare programs.
Medicaid Overhaul | Spending Cuts: The bill slashes Medicaid funding by $1.3 trillion over 10 years Coverage Loss: An estimated 8.7 million people are projected to lose coverage—about 10% of total enrollees Hospital Impact: Medicaid payment reductions will average 18% nationally, with state-level variability, leading to an expected $443 billion increase in uncompensated care costs for hospitals Key Provisions - Work Requirement: Starting in late 2026, able-bodied adults must meet work requirements to qualify (some exceptions apply) - Provider Tax Cap: Capped at 3.5% by 2028—reducing states' ability to fund Medicaid expansion - Payment Rate Cap: Limits state-directed payments to 100% of Medicare rates |
Affordable Care Act (ACA) Changes | Enhanced ACA subsidies will expire in 2026 Enrollment will get harder: - Shorter open enrollment period - Fewer special enrollment options - Annual eligibility checks Coverage loss: CBO expects 3M fewer people with ACA plans. |
Medicare Adjustments | Temporary Physician Fee Bump: A 2.5% increase to the Medicare Physician Fee Schedule in CY2026 Orphan Drug Carve-Out: Orphan drugs for multiple rare diseases are excluded from Medicare drug price negotiation rules Savings Program Delay: Implementation of a rule aimed at easing Medicare Savings Program enrollment is postponed until 2034 |
New Rural Health Initiative | $50 Billion Fund: A new Rural Health Transformation Program will support rural providers and state-level rural health initiatives |
Student Loan Policy Changes (Impacting Healthcare Trainees) | Graduate PLUS Loans Eliminated. Lifetime Borrowing Caps: - $100K for graduate students - $200K for professional students (e.g., medical, law) - Annual cap set at $50K |
Read a full breakdown of these changes from KFF